Aramco CEO Predicts Global Daily Oil Demand Will Exceed 100 Million Barrels by 2050

Aramco CEO Predicts Global Daily Oil Demand Will Exceed 100 Million Barrels by 2050
Published on: Oct 22, 2024

During the Singapore International Energy Week conference, Aramco’s CEO Amin Nasser called for a new energy transition plan, “Transition Plan 2.0,” which would focus more on the needs of Asia and the Global South countries. He expressed a “fairly optimistic” outlook on the oil demand from China, the world’s second-largest economy, especially after the government introduced a series of stimulus measures.

Last week, China’s economic slowdown became the key theme in the oil market, causing prices to plummet by 7%.

However, Nasser noted that demand for jet fuel and naphtha is rising, particularly for liquid-to-chemical projects, especially in China.

China is aggressively advancing its energy transition, requiring more chemical products for both electric vehicles and solar panels, thus driving rapid growth. As the world’s largest crude oil importer and the second-largest oil consumer, China is also Aramco’s largest crude oil customer. Nasser pointed out that Aramco plans to increase its liquid-to-chemical capacity to 4 million barrels a day, with most of the increase aimed at the Chinese market. Additionally, the company has increased its investments in China.

He also highlighted that China’s demand for aviation fuel is a “bright spot” in the country.

As for future oil demand forecasts, Nasser’s view aligns with most analysts: even if the growth in global oil demand stops at some point, it won’t decline further but will enter a long plateau. In the coming decades, the Global South will drive oil demand. Meanwhile, a major premise of fossil fuel peaking expectations is the clean energy transition. However, the energy transition in Asia is progressing much slower than anticipated.

In contrast, in a recent report, the International Energy Agency (IEA) suggested that crude oil demand might decline by the end of this decade due to the “Age of Electricity,” even predicting a sharp and sudden drop thereafter. But this is not the case; fossil fuels, especially natural gas, will continue to power the global economy for decades to come.

Therefore, when discussing the development of clean energy, we are really talking about energy addition rather than energy transition.

Nasser boldly predicted that by 2050, the global actual daily oil demand will still exceed 100 million barrels, in stark contrast to those forecasting that oil demand will or must fall to just 25 million barrels. He warned that a shortfall of 75 million barrels would devastate energy security and affordability. Therefore, to meet climate goals, countries should adopt a mix of energy sources.

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